Can I ask WHY you want to tax businesses on their Income?
As I see it, taxing income is the most equitable method of taxation. Both businesses and individuals are legal entities and as such they must obey the same laws and benefit from the same services provided by the government. Income is an excellent indication of how much governing is being consumed, and thereby a superior way to measure what is fair and just.
It goes without saying that consumers must pay for the product and/or service provided by a business. Taxes are indeed a part of any legitimate business operation and thereby add to the cost of doing business. There is no disagreement from me about how the expenses of running a business are met.
My proposal of a flat tax on income would include the elimination of ALL other taxes. As the cost of governing increases, I would expect the single rate of taxation would also increase. Importantly it would be increased for everybody to the same extent. Both individuals and business entities would see the increase, and to me that is equitable by comparison to the way taxes are collected today.
The opposite extreme to my flat tax proposal could be for all business entities to pay no taxes at all. What do you think would happen in that scenario given that the cost of operating a government remains the same? The end result would be individuals paying all the government expenses directly. Disposable income for individuals in that case would be greatly reduced due to the required higher tax rate. In my way of thinking that is not equitable because non tax paying business entities would be getting a free ride in terms of government services. Including businesses increases the number of tax payers and thus reduces the amount paid by individual entities. Keep in mind that consumers have a choice of which businesses they patronize and thus can indirectly control that portion of the tax burden. Nobody, especially businesses, should live in a country as great as ours without paying their fair share.
Last edited by yogi on 26 Dec 2022, 22:24, edited 1 time in total.
If individuals paid the federal government directly, they would only have to pay a buck for each five to seven bucks they are paying now.
The government would still be getting the same amount of taxes they are now, it just wouldn't cost the individuals as much for that to happen.
I take it, you've never owned a business before.
Businesses would still have to pay their property taxes, which covers the services they are using. Which in the end, the consumer is still paying for those also. But you have to have checks and balances to keep big businesses from buying up all the land and using it for wasted storage space.
When you started talking about a Flat Tax, I thought you were referring to Income Taxes Federal and State levels, or only at the Federal Level. We have no State Income Tax here in TN.
I've assured you a few times in the past that I have no direct experience operating a business of my own. My ideas about a flat tax on income does not require knowledge of how a business is run. For tax purposes the only relevant figure is that for income. It really doesn't matter how a business owner gouges its customers. Consumers are not stupid and will provide all the checks and balances necessary for a company to earn a fair profit.
Again, everyone would pay the exact same percentage on their income, be they a company or an individual such as you or me.
Perhaps I didn't make it perfectly clear enough that my flat tax scheme would be the only tax paid by anybody. All other taxes would disappear. More than likely that would put the flat tax rate into double digits because as I've been emphasizing all along the cost of running a government remains the same no matter where the income from taxes originates. There would be one general fund in each level of governance's treasury and that fund would be budgeted for whatever services are provided. I'm suspecting that the problem with understanding what I'm debating here is that my plan is very simple and transparent. That's the reason why it won't be implemented. It is equitable and everybody would know where their tax money is going. I can see where that could be tough on crooks and business owners.
If I understand what you are saying here, that a billionaire with 5 huge mansions on hundreds of acres of property, will pay the same amount of flat tax as a person in a small shanty, to make up for the property taxes they no longer pay.
If it were that way, everyone would buy up as much property as they could, since they don't have to pay taxes on it, only on their income as a one Flat Tax covers everything.
I really don't see something like that working out at all!
Elon Musk, for example, would pay the same flat tax as a percentage of his income as you would collecting SSA benefits. That's the vision I have of the scheme. Perhaps you haven't noticed but the billionaire oligarchs in this country are not investing the bulk of their wealth in real estate. I don't see that changing should the tax on real estate be removed. While I appreciate the fact that land ownership is a great long term investment, it's just one of many ways to get a good return on investments (ROI), which is why Elon is building space ships and EV's.
Your disposable income would increase but not entirely due to eliminating the real estate tax burden. Somebody will still have to pay for those things land owners are now financing. My estimate is that under the current system of taxation we are paying around 25% of our income in taxes of all kinds. It is possible for that figure to be the flat tax rate and for you and I to end up with an increase of disposable income. A reduction in costs for food and gas and utilities costs would bring that about. You will still eat as much and buy as much gasoline and tobacco as you always do, but the cost of those items would be reduced by the elimination of taxes on them.
I can hear you asking if the reduction in the cost of goods would be enough for you to pay that flat tax. The worst case scenario would be to break even, but most of us low income folks would see a reduction in the cost of living. A tax on income would level the burden by making taxpayers out of businesses and individuals with high levels of income. Elon and you would be paying the same flat rate, but obviously Mr Musk would be adding more dollars to the treasury because his income is greater.
Well, I'll start by saying SS is not an income to us, it is a refund of monies we paid into the system all the years we were working. We are just getting our principle back is all. This is why it should never be taxed for any reason.
I do think we should have a Flat Tax on INCOME to the Federal Government.
But I don't see how this would work on Property Taxes, because those taxes are what is used to maintain our local infrastructure and public services.
In states like TN where we have no personal income tax, but businesses do, we pay taxes when we spend money, it's called Sales Taxes, which are currently now too high for what little they go for.
I do think it is unfair to folks who work hard and earn more money, to have to pay a higher percentage on what they earn. It's not really fair to them, sorta like a punishment for doing good.
How did the Federal Government do all that they did BEFORE they started Income taxes?
I can tell you, they didn't have the BLOAT and High Pensions for LIFE that they now have to pay out.
Why would someone spend millions to get elected to an office, if they were not getting it back a hundredfold?
I don't think my flat tax scheme has any chance of becoming a reality. The theory is good and it would apply equally well to all levels of government. Each state has their own needs and provides unique services so that the income tax portion going to the state government would vary depending on where you lived. The same is true for county and city level governance. None of the government services would need to be changed, except perhaps the IRS and other Treasury departments. However, the way businesses are run and the existing patronage system would require adjustments. There would be no deductions or exemptions, for example, because the flat tax is based on income. Nothing else. Making everything equal and fair would be quite upsetting if we switched from the current system to a new simplified and equal system. Simple might be better, but it ain't gonna happen.
Before income taxes were invented the government was less complicated than it is today. My flat tax proposal would take it back to that level. But, you pose a good question when you ask about why people spend millions to get into office. First of all very few government employees do that. In fact the congress people who represent us do not work for the government. They work for us the citizens, so the theory goes. The system envisioned by our forefathers was based on good will and honor. Yes, there was a time when it was an honor to serve in congress and not an opportunity. Back then it didn't take millions of dollars to get elected. And, even today, all those millions you see being spent are not out of the pocket of the candidate. The big things today are Political Action Committees (PACs) whose sole purpose is to raise funds for the candidate they sponsor. And, those PACs do not have to identify from where those millions come. Any campaign funds that are not spent cannot go to the candidates personal bank account. That is against the law in fact. Thus, if you can come up with a PAC, you too can spend millions of dollars to run for office.
But, of course, there is a reason those PACs go through the trouble of financing a campaign, and it's not just the smile on the candidate's face. A lot pf the anonymous donors are also connected to lobbyists. The lobbyist petitions their candidate once they are in office and all that is legitimate. What is not legitimate is any compensation the candidate might receive as a result of his promoting what the lobbyist is lobbying for. Those compensations are illegal if overt and/or discovered. But, somehow, by magic, people representing us in congress seem to get wealthy just for voting a certain way.
That explains the few hundred people representing us in congress. There are millions of other people working for the government who are as honest as you and I. We are honest, aren't we? LOL Well, the government is the largest employer in the universe and my flat tax proposal might just eliminate a few of those guaranteed for life jobs. That's another reason why you won't see a switch in the tax laws as long as the current civilization exists.
On this one, I will say, I agree with everything you said!
I know in our little town of Des Peres, both before and for a short time after it became a 4th class city. All of the police cars they purchased came as new vehicle one from each local auto dealer within a 10 mile radius of the center of town. Then as the town grew, they still did that, but bought as fleet buyers, so would get perhaps 6 new cars from one dealer, and 6 new cars from another dealer, and keep the rotation going that way. Later on, after we closed down and the city had many changes, they somehow get fleets of a dozen cars at a time, although I'm sure credit goes to a dealer somewhere.
Has anyone ever wondered by almost the entire fleet of USPS vehicles were all made by Grumman for years, and why they kept them for over 35 years before replacing them. Don't know if this is true or not, but Grumman had to stock the parts for them for something like 40 years in order to get the contract.
Grumman was a defense manufacturer. But all new mail trucks will come from Oshkosh, another defense contractor.
Now you have to wonder, how many poly-TICK-ians hold stock in Oshkosh?
Government contracts are in a class of their own. Sometimes the requirements are not worth the guaranteed long term business. This is particularly true for anything pertaining to national security. The only reason a company would want to get involved with that is for the guaranteed big bucks. The risk is that those big bucks will not be appropriated for in the next congress. You not only lose the contract in that case but lose the investment you made in gearing up production to military a grade level.
There is no doubt that congress members own equities which may be affected by legislation they sponsor. There are laws regarding conflicts of interests, but the former president pretty much ignored those and set an example for his peers. It is indeed safe to say that in today's world you got to wonder about the investments made by political figures, but that wasn't a very big issue prior to 2016. There has been attempts by the Democratic controlled House of Representatives to prohibit such investments. You apparently agree with me and think that is a good idea. Unfortunately not a single Republican in all of congress agreed with us and the bill never passed.
My uncle worked for Knapp-Monarch appliance company. They got a contract to make simple coffee pots from the government, but to government specs of course. It was patterned after their own top-o-the-line coffee pot, but required even higher quality components and materials. There was nothing wrong with the materials they were using in their own products, but the government wanted even better than what was already the best materials.
I'm must pulling numbers from air here, but it is like 14 gauge 360 stainless steel wasn't good enough, they wanted 12 gauge 720 stainless, which is thicker and heavier, and a lot more expensive. Same with the heating element, handle, and lid, etc.
Now the coffee pots they made for resale, cost them around 12 bucks each to make and they sold at retail for around 39 bucks each. But the ones they made for the government cost them around 48 bucks each to make. However, the government paid them 600 dollars each for them. When they could have gotten them for only 80 bucks each in the amount they ordered.
They were also supposed to get an order for something else, of which the government wanted to pay them around the same figure 600 bucks each, so they hoped to get the order. But something happened in DC and they decided to choose another company. What was ironic about that is the other company was not in that business to start with, so the end price to make the order cost the government more like 800 bucks each.
My uncle figured they paid more to get the contract than they wanted to pay the poly-TICK-ian to push it through, hi hi.
I have very little direct experience with government contracts. Motorola, however, was into them big time. Thus a lot of what I know is hearsay. I met a genuine and official nonmilitary government employee at a party once. He had something to do with procurement, but I can't tell you today even what department he worked in. He told stories very similar to what you point out regarding how much extra the government will pay for stuff it needs to operate. He also said he had a plan that could save the government billions of dollars, but he could not get anyone to buy into it. The claim he made was that there are a lot of idle people employed in Washington. His plan would be to issue an order to every department of government to cut their staff by 10% and thereby save all that money in salaries. He also claimed that nobody would notice those people missing.
The bottom line is that anything big is inefficient by nature.
Nearly every president has created more departments in the government and staffed them.
Probably to give friends and relatives high paying jobs.
The sad thing is, many of those departments don't have anything to do anymore and have not been removed from service.
Unfortunately, when we do see any cutbacks, it is always in those departments that serve THE PEOPLE DIRECTLY, never the time wasting departments that do nothing inside the government except generate meaningless paperwork and reports.
Can you imagine the high cost of salaries for 87,000 IRS agents, and even higher salaries for those to watch over them?
What they need to do is secure our border with as many instead of more IRS agents.
Ever since I was a kid I heard about how much inefficiency and waste there is built into operating our government. I even recall a debate or two about sunset laws, all of which never came into being. I'd guess it was the Republican party which was interested in cutting down the size of government and thus proposed those laws. Each president does indeed bring with him an agenda which requires adding to the size of the government. The voters in theory voted for that candidate precisely because of that agenda. I don't see a problem with wanting to pass laws and create new government functions that actually benefit the people in some way. Biden did a lot of that in fact. I'll agree with you that the duplicate and outmoded services should have a graceful way to exit. I know for a fact that some programs do cease to exist, but a lot more don't. The reason they don't is that the benefactors object to losing their handouts. I'll go out on a limb and predict you will see some effort over the next two years to cut back and/or eliminate Social Security and Medicare. I wonder how many people will be in favor of that to reduce bloat in the government.
WE paid into social security, so it IS NOT a government handout! They in fact profited from it after taking it over.
It would take at least 20 years or more to eventually phase out social security.
Starting IRA's was just the first step in eventually ending social security.
The next step is to not collect social security, but collect for your IRA accounts.
What if anything has Biden done to help the American people?
Opened our borders, paying for illegals to get everything for free, or sending our money to protect overseas borders but not our own borders. He's literally CRAZY and VERY WASTEFUL!
What if anything has Biden done to help the American people?
I'll just quote a few things from an articles I found ...
Inflation Reduction Act - Lowering Costs, Creating Jobs, And Taking Historic Action to Fight Climate Change.
The Bipartisan Infrastructure law - Delivering Critically Needed Historic Legislation To Rebuild Our Crumbling Infrastructure.
American Rescue Plan - Providing Critical Support For American Families
Chips and Science Act - Supercharging American Innovation and Laying the Groundwork for a New Century of American Leadership.
help veterans exposed to burn pits - Righting Wrongs For Our Veterans and Their Families.
gun safety legislation - Enacting The First Major Gun Safety Law in Decades.
bipartisan legislation to invest in the Post Office - Supporting and Modernizing the Postal Service.
FORMULA Act - Protecting Americans Against Hunger.
Making Historic Steps to Restore the Judiciary.
Supporting The People of Ukraine Against Putin’s Illegal War And Holding Russia Accountable.
Ending Forced Arbitration for Survivors of Sexual Assault.
Fighting Back Against Hate, Crime and Oppression. President Biden signed into law legislation to make lynching a federal hate crime.
Let's just take a look at the first thing on the list.
Inflation is at a 40 year high and climbing, Biden Did That!
You must have got that list from Babylon Bee, hi hi.
Lowering Costs, Creating Jobs, And Taking Historic Action to Fight Climate Change. The Senate passed the Inflation Reduction Act, historic legislation that will lower drug and energy costs, create jobs, reduce the deficit, and take the most significant action ever to fight climate change.
You asked what Biden has done for the people and I'd say any president of any party would be lucky to have done only what the Inflation Reduction Act is doing.
The rate of inflation 40 years ago was in the double digits. https://www.usinflationcalculator.com/i ... ion-rates/ Under BIden it peaked at 9.1% for the month of June, 2022, and has been decreasing every month since. Also, keep in mind how that inflation was generated. It was due to tax rebates that Joe Biden gave nearly every eligible American during the pandemic. That assistance directly helped Americans who where having a difficult time, and let me guess; you didn't send back any of that cash because it came from a Democrat.
Your criticism of Biden in this case is not well founded.
If you really want to know some of the details involving the Inflation Reduction Act, you can read this this USA Today article.
I go by the prices I have to pay for things, and they are WAY UP!
Stores are closing because they cannot find anyone who wants to work.
The cost for ALL of the drugs I'm on has gone up a considerable amount starting this year they make another major jump up in price.
The Demonrats BLOCKED Trump from refilling our reserves at 24 bucks a barrel, now Biden is doing so at 80 bucks a barrel. What kind of logic was behind that? Oh yeah, the logic was to send MORE MONEY Overseas to his friends.
He stopped construction on the border rather than giving the 5 billion more to finish it, but never hesitated to send 24 billion to help another country protect their country with a wall. Where is the logic behind that? Oh, once again, the logic was to send MORE MONEY Overseas to his friends.
Last year he spent like 144 days on Vacation, when the nation was, and still is, in peril.
I don't take the time to write down all the problems Biden has caused this country since being installed in office.
